Friday, June 13, 2008

Yahoo and Google in Online ad deal: Wither Microsoft?

Just moments after a report that all negotiations have been discontinued with tech giant Microsoft there is a new report that a deal has been signed with rival Google. While some are heralding Yahoo's independence as victory over Microsoft, there are concerns amongst the Yahoo shareholders as the stock price fell 10% on the announcement of the latest Microsoft rejection. Carl Ichan, could be more encouraged to now replace the company's board with the outcome of the Microsoft negotiations.

The announcement came after Yahoo said it had failed to persuade Microsoft to renew its bid to buy all of the Internet company for the $37 per share asked, over 13% more than Microsoft's offer. Recent talks ended after Yahoo rejected a Microsoft proposal to buy just its online search business. It may be some time before the deal takes effect as Microsoft and a number of interest groups have signaled that they challenge the deal on anti-trust grounds. The Google-Yahoo plan has reportedly drawn the attention of U.S. Sen. Herb Kohl, who chairs an antitrust committee.